Chiapas Coffee part 2

Chiapas Coffee: Price, Politics and Precipitation

The volatility of coffee prices over the last two decades has been the biggest challenge for farmers and cooperatives in Mexico, and may be the single greatest factor threatening to make Chiapas’ tasty shade-grown coffee a “threatened species.”
This threat matters, beyond denying coffee drinkers a favored brew or forcing farmers to seek more lucrative crops, because, as I explained last week, the traditional methods of growing coffee plants offer huge environmental benefits for the region. But volatile prices and politics help foster mistrust, while war and climate change batter the foundations on which traditions are built.

In the mid-’90s, coffee hit a rock-bottom price of 40 U.S. cents a pound — below a living wage for small farmers in Mexico and elsewhere. Against this background, the central government, which had been very active in promoting coffee production by small farmers, withdrew its control. Stepping into this vacuum, in many cases, fair trade organizations organized coffee cooperatives to ensure a minimum wage for growers.

As Victor Pérez-Grovas, Edith Cervantes and John Burstein wrote for Oxfam International a decade ago, “These social organizations of small-scale coffee producers evolved a menu of strategies — the collective purchase and running of processing plants and warehouses, technical assistance, some financing, collective sales of their product even eventually exporting directly — and a tiered network, operating independently of the government.”

Just Coffee  --  How is life as a fair trade coffee roaster, purchasing from cooperatives in Chiapas? See Just Coffee’s Chiapas Report from October 2010. They also have friendly posters explaining fair trade and organic coffee principles.

Global prices of Coffea arabica, the more gourmet bean grown in Chiapas, are set through the New York Board of Trade, and Coffea robusta (think cheap ground coffee and instant) through London’s Euronext. Prices are greatly influenced by the top coffee corporations (including Kraft, Nestlé, Procter & Gamble, and Sara Lee, although the last named is moving out of the space) of those who collectively purchase about half the world’s coffee. The four largest coffee-producing countries (Brazil, Colombia, Indonesia, and Vietnam) affect the market depending on their crop quality and stockpiles. As reported in Revista Fortuna, although Mexico is the world’s fifth largest producer, and first for certified organic coffee, it still dances to a tune set by global prices.

In 2010, global prices spiked to highs of around $2.30 a pound. Although farmers are now theoretically paid more, higher prices destabilize the cooperatives and threaten to undo years of work.

“Cooperatives have limited funds to purchase large quantities when prices skyrocket,” said Roberto Guzman, the president of the Majomut cooperative. (The cooperative purchases coffee from 928 member-landowners, paying them fair trade prices in accordance with their certification, then ships then beans to overseas buyers.)

Speaking at their office on the outskirts of San Cristobal de Las Casas in Mexico’s Chiapas state, Guzman explained, “When prices jump, the coyotes representing multinational corporations tempt our farmer-members with big paychecks to leave our cooperative.

“In the short term, it’s an attractive option. Then what happens when the price plummets in three years’ time?”
Meanwhile, a low-grade civil war that started in the mid-’90s, the Zapatista rebellion and its focus on indigenous people, created both upheaval and renewal in Chiapas.

Mexico’s military fought the Zapatistas, and at times, entire villages were compelled to migrate, leaving behind crops and livelihoods. Paramilitary groups terrorized civilians, such as during the 1999 Acteal massacre, in which 45 men, women, and children were killed.
Although the Zapatista conflict put a serious strain on coffee production, the cooperatives emerged with renewed meaning, serving as focal points for the community’s reconstruction.

For example, the cooperative Maya Vinic formed following Acteal as a peaceful response by the community to regain strength.





Following the Zapatista movement, the renewal in indigenous cultural identity included resuscitating the traditional techniques of working the land, which included organic and shade-grown methods newly in vogue among Western consumers. Still, Mexico is a country where fertilizers and pesticides continue to enjoy a high status as emblems of technological advancement. So I was surprised to hear the barista at Toyol Witz (a cooperative’s café in the upper quarter of San Cristobal de las Casas) saying, “Organic is the right thing to do. Why not make good, healthy coffee? It is part of our heritage.”

How much Rain’s a-Gonna Fall?
A year ago September, during what Mexican President Felipe Calderon called the rainest season on record, deadly mudslides slammed into villages in Oaxaca and Chiapas, and neighboring Guatemala.

It was yet another sign that the wet season, from June to October, has turned from predictable to erratic. Unexpected rains now come as farmers are sun-drying coffee beans, while the balance of the dry season is becoming hotter and more intense. According to Romeo Dominguez, director of the conservation-oriented nongovernmental organization Pronatura Sur, wildfires are more common: in the coffee-growing regions of Sierra Madre and the Lacandonian Jungle in Chiapas, an unusual 70 to 80 fires have been reported in the last few years.

“Rivers that used to be year-round are now seasonal, cold temperatures are freezing crops, and rain erosion is destroying soil,” Dominguez recounted of farmers’ observations. This year’s crop in particular suffered a drop in quality, said Roberto Guzman of the Majomut cooperative. “Thankfully, yields were sustained, but we couldn’t fetch decent prices.”

A study of climate forecasts specifically for coffee communities in Sierra Madre de Chiapas noted that coffee suitability (i.e. its optimum growing conditions) squeezes into an increasingly narrow tier. In the prime coffee growing elevations of 600 to 1,400 meters above sea level of the Sierra Madre, a vast majority of land cover has coffee plantations. Lower altitudes will become less viable for coffee due to heat and drought effects. Higher altitudes are at risk from cold spells and rain erosion.

What are the options for preserving shade-grown coffee and farmers’ livelihoods? Strengthening resilience is the first step, according to an adaptation assessment by the German development organization GTZ. They collaborated with Más Café, a conglomerate of eight cooperatives and 2,200 producers in Chiapas, to determine the best practices for adaptation. They cited a number of techniques like erosion control to protect crops and natural composting of soil for productivity, along with pest-resistant crop varieties, and diversifying farmer’s income to reduce dependence on coffee as the only cash crop.

But if yields and income drop, farmers lose their incentive to raise shade-grown coffee. One option is to pay extra for farmers to keep forests intact as carbon storage, a tricky undertaking proposed at the global level by REDD, a forestry finance mechanism (officially known as the United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries.) However, Mexico’s forests are privately owned in small plots, and committing 20 years to preserve forests may be difficult for small farmers.

Even if adaptation techniques are available and cost-effective, farmers may not perceive information about the risk as credible and have little motivation to act. According to sociological research in the Chiapas coffee sector, the farmers’ strong social identity undermines the legitimacy of information about climate risks and responses offered by outsiders.

According to study leader Elisa Frank, “being part of the in-group, coffee cooperatives can be a bridge between climate scientists and individual farmers, but perceived illegitimacy of experts can be a significant barrier. New relationships of trust need to be developed.”

The Future of Coffee in Chiapas
Three biosphere reserves are found in the Sierra Madre de Chiapas region: La Sepultura, El Triunfo, and Volcán Tacaná. These treasures of fauna and flora are now linked to the well being of coffee farmers. If coffee farmers go bankrupt and the land is transformed to other uses — like cattle grazing or corn — large stretches of forest will also be compromised.

It’s about the people, as much as anything. “We want to conserve forests,” said Dominguez of Pronatura Sur. “But without reasonable income for the farmers, for the security of their families, for the education of their children, there is nothing. They aren’t asking for much — just dignity.”
Technical considerations are important. But for tasty coffee to continue to grow in Chiapas, and for forests to remain intact, farmers need a way to maintain their income and dignity.

Chiapas Coffee part 1

Antonio, the Majomut cooperative supervisor, shows off the coffee plants. The cooperative purchases coffee from member-landowners, pays them fair trade prices, then ships then beans to overseas.

Chiapas' Coffee Growers: Accidental Environmentalists
Every steaming cup of coffee could tell a story, and the shade-grown coffee from southern Mexico's Chiapas state tells tales of a disproportionate role in sustaining local villages, hillsides, and wildlife.
It's a story with several lumps of conflict and uncertainty stirred in.
The volatility of the global coffee market makes it a difficult business, and Chiapas' small farmers face the precarious equilibrium common to all small farms and businesses. But they face an additional set of unique challenges, including the shaky political truce between the government and Zapatista rebels who made global headlines in the mid-1990s for taking up arms in the name of indigenous peoples' rights. Meanwhile, the toehold made by organic and fair trade initiatives is slipping in Chiapas even as a rapidly changing climate could kill the region's top cash crop.
Chiapas has some of the world's tastiest coffee, but will the campesinos (peasant farmers) continue to grow it? Will the biodiversity and carbon storage inadvertently protected by this style of coffee production eventually be compromised?
The Origins
I went searching for these answers in the highlands of Chiapas. Uphill from the charming colonial town of San Cristobal de las Casas is the much smaller community of Chamelho. Swooning after a rough mini-bus ride, and waiting for the next transport, I made a pit stop at a church in the main plaza. It was a striking scene: a combination of grass, dirt, and indigenous icons surrounding scenes of Jesus and the Nativity, an odd melding of the Christian and Mayan sacred. This juxtaposition was a tourist attraction in less remote villages, but this church featured only local parents and their children listening to music and chatting amiably.

Click here for more posts from the Voyage of Kiri.

After a series of enthusiastic hand gestures — many people in these parts rely purely on the Tzotzil Mayan language — I was dropped off at a wooden warehouse that smelled of coffee. It wasn't thick and tangible like your neighborhood coffee shop, but rather deep and musky like freshly cut grass. Clustered around a table were four Tzotzil Mayan girls in flowery blue dresses with ribbons in their hair, knitting new additions to their homemade garb.
The place was a coffee cooperative, Majomut, and it too was a melding of the indigenous and the international. The cooperative purchases coffee from 928 member-landowners, paying them fair trade prices in accordance with their certification, then ships then beans to overseas buyers, such as Café Direct, which specialize in ethical coffee and tea purchasing.
Antonio, the cooperative supervisor, greeted me jovially, and proudly led me to the reddish machine filling two big rooms. "This is where the magic happens," he said in good Spanish. He explained how the contraption transformed the dried coffee cherries into usable product through a process of shelling, sorting, and roasting the beans. They were bagged under three labels: "local usage," "national market," and "overseas export." The better the quality, the further the destination.

Poor quality coffee beans are evident in the cracked shells, caused by the excess rains this year.

Afterward, Antonio led me outside, promising a close look at a coffee plantation. I was surprised — the "plantation" looked like a forest, shaded by the canopies of tall pine trees and steep hillsides thick with understory shrubbery. Scattered banana trees revealed humans had modified the plantation, and a skinny path led to coffee plants and the shiny red fruits of Coffea arabica. The forest absorbed the coffee plants.
"Why do they prefer to grow coffee under shade?" I asked.
The coffee forest is integral to the Chiapas farmer lifestyle, Antonio explained. Campesinos organize their plots of land into milpas, a rotating combination of crops. For example, a five-acre parcel may be divided into two acres of corn, one acre of beans, and two acres of coffee. "In general, the corn and beans feed the family, and the coffee earns them money. The forest harboring the coffee also provides firewood, medicinal plants, erosion control, and great place for fruit trees," he explained, highlighting the diverse value of the coffee plantation beyond being a cash crop.
In Chiapas, at least, coffee traditionally is grown under the shade of trees, not to please environmentalists but for practical benefits. For one, growing in a diverse habitat keeps the plants healthy and resilient: Pests are less able to colonize the area; falling organic matter creates natural compost for the soil; tree roots and shrubs hold earth and slow water flow, minimizing erosion from heavy rains. Use of pesticides and fertilizers is uncommon. The shade lowers heat and evaporation, which becomes a significant benefit for other crops during the dry season.
Even though they are human-modified systems, coffee forests have surprising biodiversity. Scientific studies have detailed their role in preserving wildlife habitat, on pollination  and have identified how intensification of coffee production from shade-grown to sun-exposed monoculture causes a vast loss of species.
On a more technical level, shade coffee can maintain the genetic diversity of native trees, according to an article in the journal Current Biology, which investigated bird and bat species living in coffee forests. Lead author Shalene Jha of the University of Texas at Austin noted: "By supporting important seed dispersal processes, shade coffee farms maintain plant population gene flow across fragmented habitats." Therefore, coffee farms play an unusual and important ecological role that is just now being fully understood.

In front of the Majomut factory in Chiapas, Mexico.

Carbon storage is another recently recognized value of shade coffee. Agro-forestry systems show potential for carbon sequestration since they store carbon and reduce deforestation pressures. Specifically, coffee is a perennial crop well suited to complex canopy environments and could potentially sequester around five tons of carbon per hectare, as reported on the Coffee Habitat website. (Here is a comparison with other agricultural practices common in the U.S.; remember that a hectare is about two and a half acres.)
Paying coffee farmers for carbon storage may be in the near future. A partnership between Rainforest Alliance, the World Bank's International Finance Corporation, and an agro-industry corporation recently developed methodology for carbon monitoring in farms. A consortium of three states (California in U.S., Chiapas in Mexico, and Acre in Brazil) in late 2010 began to explore reductions in deforestation (also known as REDD, which the Guardian explains nicely in this Q&A). These transactions may play an important role in the continued viability of shade-coffee farms.
Coyotes vs. Cooperatives
Despite its profits and integral relationship with farmers, coffee has been a tricky business in Chiapas.

In the late 1980s, the dismantling of the Mexican National Institute of Coffee, along with the collapse of the International Coffee Agreement, caused prices to spiral down to a low of 40 U.S. cents a pound — below cost for most coffee farmers. Nevertheless, the coffee intermediaries — affectionately called coyotes in Mexico, pirañas in Peru, and sharks in Indonesia — squeezed prices paid to small producers.
Sun-grown coffee monoculture — think of an orchard instead of a forest — was promoted as a way to produce more beans with greater efficiency. In Central America, development organizations such as U.S. Agency for International Development, which historically invests heavily in helping coffee-producing regions, invested in the conversion of coffee farms to this higher-yield approach. The method requires substantial amounts of fertilizer and pesticides, which damages naturally occurring bacteria in the soil that contribute to organic productivity.
Subsidies covered these expenses for a decade or more, but eventually farmers plunged into debt spirals after borrowing money to pay for these agro-chemicals. With their land altered by the chemicals, they couldn't easily switch back to more traditional methods. Equally unfortunate, since forests weren't around to hold the soil during heavy rains, erosion increased and the runoff itself was tainted by the farming chemicals.
In response, fair trade organizations (which may have their own issues) began to collaborate with local coffee cooperatives like Majomut. They bypassed the coyote intermediaries by guaranteeing a minimum price for coffee (around $1.20 a pound). Organic coffee was also encouraged with premium prices. Traditional knowledge that supported organic production was re-introduced via workshops and town hall meetings. Ironically, USAID was now at the forefront of organizations promoting these practices.
The goal of these new specialty markets was to sustain the livelihood of small coffee farmers and protect biodiversity. They succeeded. Nowadays one can purchase their brew at neighborhood coffee shops, a venue where the higher amount paid to the producer is easily masked by the markup on a cuppa.
But price, politics, and precipitation continue to test the survival of cooperatives and the integrity of the system. Staying a step ahead of these changes is now the name of the game, something I'll discuss more deeply next week.


See original article.